IDFC First Bank Q3 Results: Net Profit Falls 53% YoY To Rs. 339 Cr; NII Grew 14% To Rs. 4,902 Cr

The financial results for the quarter and nine months ending December 31, 2024, were released by IDFC FIRST Bank on Saturday. Net profit increased 69% QoQ from Rs. 201 crore in Q2 FY25 to Rs. 339 crore in Q3 FY25, a 53% decrease from Rs. 716 crore in Q3 FY24. The net profit for the 9M-FY25 fell 45.3% year on year.

"The profit was largely impacted by reduced income from slowing down disbursal of micro-finance loans, increase in provisions on micro-finance and normalization of credit costs of non-microfinance business," mentioned IDFC First Bank in a statement.

The bank said that its Net Interest Income (NII) jumped from Rs. 4,287 crore in Q3 FY24 to Rs. 4,902 crore in Q3 FY25, a 14% year-on-year growth. The NII rise for the 9M-FY25 was 20.1% on a year-on-year basis. In Q3 of FY25, the bank's Net Interest Margin (NIM) reached 6.04%, whereas in Q2 of FY25, it was 6.18%. From Rs. 5,803 crore in Q3 FY24 to Rs. 6,682 crore in Q3 FY25, the bank's operating income surged by 15%. Operating income grew 19.4% year on year for the 9MFY25.

While retail deposits mushroomed by 29.6% year on year from Rs. 1,39,431 crore on December 31, 2023 to Rs. 1,80,752 crore on December 31, 2024, customer deposits climbed by 28.8% YoY from Rs. 1,76,481 crore on December 31, 2023 to Rs. 2,27,316 crore on December 31, 2024. From Rs. 85,492 crore on December 31, 2023, to Rs. 1,13,078 crore on December 31, 2024, CASA Deposits increased by 32.3% YoY. The CASA Ratio was 47.7% on December 31, 2024. As of December 31, 2024, about 80% of all customer deposits are retail deposits.

As of December 31, 2024, IDFC First Bank reported that its loans and advances (including credit substitutes) had grown by 22.0% year over year, from Rs. 1,89,475 crore to Rs. 2,31,074 crore. The bank's corporate (non-infrastructure) loans increased by 28.9% year over year, while its retail book expanded by 21.3%. As of December 31, 2024, the bank's gross non-performing assets (NPA) was at 1.94%, down from 2.04% on December 31, 2023, while its net non-performing assets (NPA) stood at 0.52% on Q3FY25, compared to 0.68% on Q3FY24.

Mr. V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank, said, "Our bank continues to grow well on loans and deposits. Our customer deposits is growing strongly at 29% YoY to reach Rs. 2,27,316 crores, with the CASA ratio sustaining at 48%. The loans & advances grew steadily by 22% YoY to reach Rs. 2,31,074 Crores." We are specifically tracking Micro-finance loan book closely considering the industry situation. The asset quality of the overall Bank's loan book is stable with Gross NPA at 1.94% and Net NPA at 0.52%. Excluding the micro-finance loan book, the GNPA and NNPA of the book of the bank is even lower 1.81% and 0.49%."

"The credit issues in Microfinance segment as a transitionary issue which is likely to be resolved within a few quarters. The Bank built this business because it was important from priority sector lending norms point of view, particularly meeting PSL norms for Weaker Sections and Small and marginal farmers PSL categories. All other businesses being built as part of universal banking, including deposits, loans, Credit Cards, Wealth, Cash Management, Corporate Banking, Fastag, Gold Loans are doing well. Over the next few years, the C:I will come down because of operating leverage, as we scale up. As mentioned earlier, the bank is growing steadily in scale," V Vaidyanathan added.

In October 2024, the Bank successfully merged with IDFC Ltd., increasing its net value by Rs. 618 crore while reducing the number of outstanding shares by 16.64 crore shares. With the addition of 9M-FY25 earnings and the already discussed merger impact, the overall CRAR as of December 31, 2024, would have been 16.11%, with a CET-1 ratio of 13.68%.